Best Buy To Let Schulze's Bid Move Forward, Start Due Diligence

Best Buy will allow founder Richard Schulze to conduct due diligence and form an investment group to make an official bid for the struggling retailer.

Schulze will have 60 days after starting the review of the company's financials to finalize the offer. If the first proposal is rejected, Schulze will need to wait until next January 2013 to make another. Should both fail, Schulze would then be able to take the bid directly to shareholders.

If all talks prove futile, Schulze would then wait a year before making a further bid. Importantly, the board has agreed to waive a part of Minnesota law that might have delayed Schulze's actions. Schulze needs access to the complex financial information in order to attract private equity partners.

Schulze, who owns 20% of the company he founded more than 40 years ago and left only in June, would receive two board seats.

The agreement between the company and Schulze comes less than a week after Best Buy named a new CEO and Schulze rejected an earlier offer to begin due diligence. It was also a span that freshly illuminated the company's problems: Best Buy withdrew full-year guidance after second-quarter profit plunged by 90%.

Schulze has voiced an interest in making a $24 to $26 a share offer for the company, a deal that would total close to $8 billion. He says he's interested in moving swiftly with the process, before Best Buy's perilous position worsens. He has pointed to Best Buy's slumping market share and mounting losses of customers to Wal-Mart and Target, as well as e-retailers like Amazon.com and eBay.